By Eric Savitz

Apple (AAPL) shares have extended their recent rally this morning, getting a boost from several piece of news and speculation.

The most interesting tidbit, which began making its way around the Net yesterday (it was posted several times on the comments section of this blog) is a piece from the iPod Observer blog which says that Gartner analyst Ken Dulaney believes Apple has ordered 10 million 3G iPhones. The piece also said that Dulaney believes Apple will use an Organic Light Emitting Diode (OLED) display in the new iPhone. The piece also said that Dulaney believes Apple didn’t do as well as it expected in Europe with the first version of the iPhone.

Also this morning, Bill Fearnley, an analyst with FTN Midwest, this morning slightly raised his EPS estimates for the fiscal year ending September 2008; he goes to $5.18, from $5.15. For ’09 he’s now at $6.35, up a penny. Fearnley says February Mac sales were above plan, and that March also got off to a strong start. He has a Buy rating and $215 price target on the stock.

Not least, Morgan Stanley’s Kathryn Huberty today wrote a bullish note on the company focused on the long-term value of its strength in higher education. “We view Apple’s building momentum in higher education as another key growth lever,” she says. “In the near term, it sets the company up for a strong September quarter. Longer-term, we see an ‘aging phenomenon’ that will put Apple in a more mainstream market share position as students enter the work force.”

Huberty notes that a recent higher education survey shows Apple’s mind share tracks well ahead of the current market share – 40% of college students plan to buy a Mac, while just 15% actually have one so far. She maintains her Overweight rating and $185 price target.

Apple today is up $3.66, or 2.6%, to $144.64. The stock has now rebounded about 20% since bottoming at $119 and change in late February.

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There are 93 comments

MARCH 26, 2008 12:32 P.M.

Mack wrote:

Old fashioned rumors and innuendo...classic pump-and-dump story. Sometimes one has to be reminded that the economy is in a recession and this is bear market.

MARCH 26, 2008 12:35 P.M.

chris wrote:

if the market goes green today could see apple close to $150

MARCH 26, 2008 12:41 P.M.

Bob wrote:

Where's TONI Spaghetti?

MARCH 26, 2008 12:43 P.M.

Ed wrote:

Yes, the economy is in a recesion--but last i checked, people are still getting up every morning, kids are still enrolling in college, and the sun contnues to rise--it's not the end of the world and it's not the end of apple or the consumer.

MARCH 26, 2008 12:47 P.M.

Nirav wrote:

Not sure about today, Oracle's fabulous earnings after the close today might attract more buyers tomorrow that can take AAPL to $150 or above....

MARCH 26, 2008 12:49 P.M.

Bob Zimmerman wrote:

True that info about Iphone are rumors, but at some point Apple will deliver the 3G; also Macs are selling way above estimates. Apple stock was beaten down too far far such an iconic company that consistently delivers superior products that redefine markets. As Steve Jobs said recently, patient investors will be rewarded. Jobs right now is the best CEO in America.

MARCH 26, 2008 12:50 P.M.

john abbott wrote:

interesting

MARCH 26, 2008 12:58 P.M.

Cid wrote:

Ipod, IPhone, ITunes, I can`t see clouds for the IShares in the Ifuture.

MARCH 26, 2008 12:58 P.M.

Armando Assis wrote:

Apple stores are packed, now imagine if we weren't in recession.

MARCH 26, 2008 1:00 P.M.

timcomz wrote:

Eric, does it hurt to post something positive on Apple? You are the most biased so called journalist I have ever read. You should resign and kill yourself. Have a nice day.

MARCH 26, 2008 1:03 P.M.

Eric Savitz wrote:

That post seems pretty positive to me.

MARCH 26, 2008 1:08 P.M.

timcomz wrote:

Eric, I guess you didn't take my advice. Look up sarcasm when you're done scouring the world for negative Apple news. Thank you and have a nice day.

Eric, apparently you need to be proclaiming Steve Jobs as god to make some people happy. I do believe AAPL has been unfairly hammered lately, but it gave me an opportunity to jump in. I think I'll sell the day Jobs steps down.

MARCH 26, 2008 1:12 P.M.

thomas a. Gaughan wrote:

Eric, thanks for the good Blog.

Thomas A. Gaughan

MARCH 26, 2008 1:19 P.M.

Craig wrote:

Folks still so not understand the cell phone market. It is almost unlimited - what, a billion of them on the planet? And apple gets monthly kickbacks from AT&T. OSX is the OS of the future, also - on MANY devices. This is a juggernaut that cannot be stopped.
Those who are bearish on the market might want to pick up some 2010 options....

MARCH 26, 2008 1:20 P.M.

Forgot this wrote:

Not just 3G but a full blown movie camera too...

MARCH 26, 2008 1:24 P.M.

OilBurns wrote:

I agree these anaylsysts seem to conspire with their clients to pump this stock. Come next week, a wave of bad economic news will drown out today's glowing analyst review of Apple. The stock will then retreat to $120. AAPL is not an investor stock. It is for day traders and hedge fund managers.

MARCH 26, 2008 1:27 P.M.

MArk wrote:

Sounds like Mack sold at 120

MARCH 26, 2008 1:29 P.M.

Craig I wrote:

Here is another little tidbit. It has long been shown by surveys that mac users are more productive - therefore in general more successful. That means we buy more ipods, copies of final cut pro and other such stuff FROM APPLE. Recession or not......while a business that uses windows can often coast along on the old machines. As itunes has shown, apple folks actually BUY things, as opposed to stealing them. This company will, IMHO, hit the stratosphere.

As partial disclosure I am usually long, but I sold most at 180-190, and am now back in again on the way down.

MARCH 26, 2008 1:33 P.M.

Craig wrote:

Oil,

That's funny! Maybe you should look at a 5 year chart?

Are you saying real investors buy IBM, Lucent, Bear Stearns and Microsoft?
Tell you what - look at a !) YEAR CHART, and tell me you are not jealous. Those day traders must have somehow fooled a lot of people. Ha ha

MARCH 26, 2008 1:34 P.M.

gpnder6 wrote:

as strange as it may seem, do NOT confuse the share price of apple with the company. apple(the company) has (and still is) performing brilliantly, and as long as the co. targets specific segments of the tech markets that have been ignored, the co. and the stock will do quite well.

MARCH 26, 2008 1:34 P.M.

DickM wrote:

OK, everybody post their position on Apple hereafter: OUT, Inlong, Inshort, or Lurker. This will sift out the wise-A--es out there.
I am inlong (since '96 - untraded!)
Remember this, APPL has made more millionaires then any other company. If you want to be negative on Apple, you do so at your own peril.

MARCH 26, 2008 1:40 P.M.

AAPLpie wrote:

Hey, it's a beautiful sunshiney day!! Folks, the ride won't be smooth, but it's going to be UP. Fasten your seatbelts. iPhone in China BEFORE the Olympics...earnings report next month...rumors starting to pick up steam...I'm on a major college campus and it's a Mac attack...so a cool social status symbol that also works better than the competition...does it get any BETTER than that??? Whatever, Antie is still waiting for 86 - will have to wait for the next 3:1 split, I guess....wow, AAPL is even beating RIMjob today - where's joemiz and master?

MARCH 26, 2008 1:44 P.M.

pug wrote:

some posters are a bit nuts

MARCH 26, 2008 1:47 P.M.

MArk wrote:

There were dark days for AAPL in the 90's ... but since Jobs return AAPL is again producing compelling products. Everyone else is slapping together bits and pieces and producing some Frankenstein ... Sometimes I he's too far out in front (G4 Cube) but then sometimes I am left confused how somethings do so well (MacBook Air) ... But, the iPhone is the most satisfying consumer purchase I ever made ...

MARCH 26, 2008 1:48 P.M.

Anonymous wrote:

iPhones, iPods use Broadcom controller chips. Good news for BRCM!

MARCH 26, 2008 1:54 P.M.

Ira wrote:

speaking of mindshare, how do feelings of guilt and inadequacy figure in? Just walk up behind somebody with a B'Berry and say, "Oh, is that an iPhone?"
What 'em scramble, back-pedal, and promise to do better. Ain't it grand to be in love?

MARCH 26, 2008 1:55 P.M.

antie wrote:

Expected a big runnup ahead of RIMM, reason for quiet period. That said, better hope RIMM kills it, if not Antie will have her apple pie and you guys will eat crow. PS Hope rimms good for your sake, means nothing to me. Watch out for big down day 2 or 3 trading days before RIMM as chickens get out. May miss out, but wont be at risk until 86.

MARCH 26, 2008 1:57 P.M.

MArk wrote:

RIMM's days are numbered ... The iPhone train has only just left the station ... With SDK on a OS X platform who will want a CrapBerry ... there ace-in-the-hole was the push email and "security" ... Back to Canada

MARCH 26, 2008 1:58 P.M.

antie wrote:

Had resistance around 146 big down may have started already. Carefull!!!!

MARCH 26, 2008 2:04 P.M.

Technical wrote:

I hear air coming out of apples too.

MARCH 26, 2008 2:13 P.M.

Steve wrote:

Digg founder Kevin Rose kicked off this week's Apple rumors by claiming a 3-G iPhone was only a few months away and would feature not one, but two cameras for the purposes of video chat.

Now Gartner analyst Ken Dulaney is fanning those unsubstantiated rumors. The analyst says his own sources in Asia have indicated Apple has in fact already placed an order for 10 million of these second-generation iPhones. That's in addition to the 10 million v.1 iPhones Apple has ordered, Dulaney says.

While he doesn't give a specific timeframe for its release, Dulaney does claim Apple moved up its iPhone v.2 release mainly to help spur on iPhone uptake in places like Europe, where slow sales have been attributed to the phone's distinct lack of 3-Gness.

As it stands, Delaney's claim is also in keeping with another rumor. Last November, tech blog Sevenclick spoke to a manager at Spain's Telefonica, who said, among things, that while Telefonica and Apple had yet to reach an official agreement, the carrier expected to release a 3-G iPhone by May.

Here in U.S., AT&T has all but confirmed a speedier version of the iPhone will drop sometime this year and, for now, the main point of contention among analysts is simply when this will happen. Two camps have emerged: One that thinks the second iteration of the phone will debut sometime around the holiday season. Another believes May or June is the most likely date.

MARCH 26, 2008 2:17 P.M.

Whatever wrote:

I bet RIMM has a solid quarter.Apple is not going down nearly 60 points to "86" no matter what losers like antie say....

MARCH 26, 2008 2:25 P.M.

anonymous wrote:

Good Job Jobs, Now we want a 3 to 1 split. Or at least a 2 to 1. That will bring many more apple lovers on board.

MARCH 26, 2008 2:25 P.M.

brianct wrote:

Has anyone used apple's networking products. After trying netgear, belkin, and linksys, I bought 3 apple extreme airports for my home network and the coverage is perfect. And I did not have to compromise security when extending the network. No to mention, it worked seamlessly with my Vudu and Directv On Demand. If Apple starts developing other simple elegant technologically superior home products like this, and possible in the Enterprise market, it could see some serious revenue growth. But all of that is speculation... this is a long hold... it could easily go back down to 120 in the near future.

MARCH 26, 2008 2:26 P.M.

AAPLpie wrote:

The real question is when will AAPL and RIMM not move together?? PALM is out, and RIMM will be too at some point...matter of time. The revolution has begun - out with the old (MOT, PALM, RIMM soon enough, etc.) and in with the new.

MARCH 26, 2008 2:32 P.M.

AAPLpie wrote:

Antie, I think you're holding your stock chart upside down again. Orient it properly and I think you might notice the distinctive UP trend....

MARCH 26, 2008 3:10 P.M.

Joe, boston ma wrote:

Eric,

I've been following your blog for months and while I frequently disagree I still appreciate getting another point of view.

The personal attacks are way out of line. keep up the good work.

MARCH 26, 2008 3:19 P.M.

johnny wrote:

-Mack

Well, I wonder what it means when YOU HAVE TO Be REMINDED??
Perhaps that YOU aren't in a recession!
Enjoy YOUR'S !
I won't be partaking!

MARCH 26, 2008 3:25 P.M.

Eric wrote:

Why shouldn't AAPL ($128 B) have a market cap at least as large as MSFT ($266 B)? AAPL produces a large software suite just like MS, they produce a software OS just like MS, but they also have a high-margin hardware business that puts the software revenues to shame. With AAPL continuing to grow Mac market share 30-60% a YEAR, this puppy is going to fly into the $300-400 B market cap range relatively soon. That means a tripling of AAPL stock, $450 range, over the mid term. In my educated opinion, of course.

MARCH 26, 2008 3:41 P.M.

pumpndump? wrote:

definitely sounds like pump n dump.

MARCH 26, 2008 3:43 P.M.

metoo wrote:

Concur... timconz sounds like a 'slow' fellow.

MARCH 26, 2008 3:56 P.M.

Constable Odo wrote:

Had Apple placed an order of 10 million v.1 iPhones from the start? Then where are those iPhones now since the NYC Apple stores are out of them? Apple should just be able to grab stock from any store and ship them to where they're needed. Surely all those older model iPhones can't be sold out already since that would put sales at the 10 million unit mark now. Rumors about a refresh don't seem likely. The iPhone was already refreshed with a 16GB model a short while back. I find all this rumor stuff very confusing, but I'm not complaining as long as the stock price continues to move upward.

MARCH 26, 2008 3:59 P.M.

Will P. wrote:

The stock price and the economy are just a guess on anyones part but Apple the co. looks solid for the next 5 years. I'm investing based on the latter for the long term. (Read: Not a day trader).

MARCH 26, 2008 4:03 P.M.

Duck Neck Soup wrote:

I have been to the iPhone assembly line in China, and saw the 3G iPhone with my own eyes. Was an honored guest, and got to have Duck Neck Soup (disgusting) with the executives of Foxconn. 3G is almost here!

MARCH 26, 2008 4:57 P.M.

lyerlyer wrote:

Ducky The only honor you have is most outrageous bullshitter.

MARCH 26, 2008 5:00 P.M.

william mainwald wrote:

Just a reminder to all of you out there in the market place who think they know what a stock is worth. It's only worth what someone is willing to pay for it at any given time. Forget PE ratio's EPS, cash flow, etc. Where were all the brillant people when the FED went looking for someone to bail out Bear Stearns with their unknown value of their CMO's holdings. AND THE STORY IS STILLNOT FINISHED THERE. So apple fans ( and I am one of them) do not delude yourself. Any investment is worht only what some other party is willing to pay at any given time!No Exceptions!!

MARCH 26, 2008 5:00 P.M.

Rob L wrote:

I'm glad I kept buying during the pull back! We'll see a minimum of $200/share by year's end. Not saying it's going to be straight up, but BUY on dips!!!!

Duck Neck - sounds so good - but how do we know you are not just a quack??

MARCH 26, 2008 5:18 P.M.

Core wrote:

I think the shares will go higher. Apple has the most innovative products and ideas. The new iMac is amazing. Still many people out there want to get an iPhone. i am excited for the future!

MARCH 26, 2008 5:26 P.M.

antie wrote:

AAPLpie...Dont confuse yourself with charts, stick to your revolution mantra. So if the trend is up that doesnt ever stop? Remember I wish you and even that rude whatever LUCK on RIMMS report. Apple has been elevating on the shorts fear that RIMM will kill and Apple will hang onto the coattails. Pretty soon, maybe already today, the fear will switch over to the longs that RIMM will miss. Coattails down " in sympathy" trader talk for apple. Both hit resistance today. Apple should hold 130 on a RIMM miss, but if both miss, I will buy it at 86 or so.

MARCH 26, 2008 5:27 P.M.

Doukas wrote:

Microsoft and Apple are like GM and Toyota.
Apple makes quality Microsoft quantity. It is a matter of time
(and not so log) before Apple catches up to Microsoft.
Also the computers of the future will be a mobile notepads of various sizes.

MARCH 26, 2008 5:51 P.M.

Whatever wrote:

STOP THE "86" CRAP NOW!!!!!
YOU ARE AN IDIOT!

MARCH 26, 2008 5:55 P.M.

Andy wrote:

Unless iPhone is around $200 ...

You guys are talking as if Apple is the only player. Wait for Intel Atom CPU comes out, and you'll see $300-$400 laptops packed with 10G-20G solid drive. That's when Microsoft could hurt Apple (all Apple products) by giving out something called Vista Express for cheap.

Sell AAPL shares while you can ...

Rebates from carriers will be thing of the past if these small laptops can be used as a phone as well (a better video phone in fact). You can't dial the iPhone when you're driving anyway.

MARCH 26, 2008 6:31 P.M.

jon wrote:

currently in Rome- you can't believe how many stores carry iPhones- all were bought in the US and unlocked (they sell them open box). The price is between 850 and 950 euros (about $1250 depending on the exchange rate) but they're selling like hot cakes. The owner of the store even offered to buy my (used) iPhone from me for above retail value so he could sell it. Its hard to believe that the sales figures are allegedly so low in France / Germany.

MARCH 26, 2008 7:10 P.M.

Antie wrote:

Whatever...How can your rash be getting worse with the stock price up 30 in the last month??? Try a little SELF CONTROL. That is all you can control.

MARCH 26, 2008 7:21 P.M.

baaker wrote:

iPhone fever notwithstanding, the most interesting growth numbers are for Mac computers, particularly laptops. Note the pics from today's Firefox 3 press briefing. Also: Only a consumer with their ice cream spoon stuck in their forehead would buy a product named "Vista Express".

MARCH 26, 2008 7:56 P.M.

jimmy hoffa wrote:

Doukas.. that is a very good statement
and probably very close to the truth

MARCH 26, 2008 8:00 P.M.

S. Jobs. wrote:

How do my tail lights look?

MARCH 26, 2008 8:03 P.M.

@ Andy wrote:

Wow, "You guys are talking as if Apple is the only player. Wait for Intel Atom CPU comes out, and you’ll see $300-$400 laptops packed with 10G-20G solid drive. That’s when Microsoft could hurt Apple (all Apple products) by giving out something called Vista Express for cheap."

Yep, just wait for Microsoft to ....er.... do anything. :-) That is what they do best, keep you waiting for their next product. Hey, in 2010 they will have Window 7, you know like Vista was going to be,.... but better. LOL

Yep. soon...... any day or week or year now. ..... :-)

MARCH 26, 2008 8:08 P.M.

S. Ballmer wrote:

Not only that but wait till I do my Monkey dance again! Zune Rocks!

MARCH 26, 2008 8:09 P.M.

GoPe wrote:

Andy, you have no idea how wrong you are... or do you?!?!

About Vista - the only way I would have it on my PC is if it was given to me for free (which it was). Personally I think Win XP is better competitor to Leopard than Vista.

I am IT Professional and I haven't seen Vista on any PC used by developers. This is the case also with few MS Gold Certified Partner companies. The infrastructure department says "Vista is simply not stable enough!"

MARCH 26, 2008 8:13 P.M.

LotsaLuck wrote:

Long lines waiting at Wal Mart for the Dell phone!

MARCH 26, 2008 8:29 P.M.

mrtaxx wrote:

Analyst: Toni Saccongati (not sure of spelling , but you know who I mean),

dead man walking,

may he rest in peace,

MARCH 26, 2008 8:38 P.M.

Tom wrote:

Andy, it ain't the price and it ain't the hard drive. PC's have been selling cheap with Windows for years and it continues to sell cheap today. I can buy a $500 PC today from Amazon and yet Apple survived, why?

It is not the price, it is the software and the s/w+h/w integration.

Until Microsoft or some other companies can come up with an OS and a User Interface and a suite of well-integrated tools that really address people's needs, Windows will remain windows regardless of whether it is Express or Sluggish.

We want something that just works, that requires minimum administration, that integrates seamlessly and easily with other software, that looks beautiful and that is reliable. Whoever can do that, be is MSFT or IBM or Orange or Red Cloud, that is what we will buy.

To think it is just price, larger drive and a renamed Windows is really naive. If you are an Apple investor, you would love for Microsoft to believe that so Apple can keep gaining market share.

MARCH 26, 2008 9:03 P.M.

Don't get it??? wrote:

What fascinates me is all the people who will only buy Japanese or German cars versus American cars due to their quality yet they buy and defend Windows Vista and crap hardware like Dell??? I wonder how much longer this will continue? Toyota will soon pass GM.., which is amazing.

MARCH 26, 2008 9:06 P.M.

What Recession? wrote:

Four Horseman mounting up!

MARCH 26, 2008 9:09 P.M.

Don P. wrote:

MacBook Air, the Ferrari of Laptops is selling like crazy! Steve Jobs is still a visionary founder at the top of his game. Unreal!

MARCH 26, 2008 9:13 P.M.

3G! wrote:

All 3 New York Stores sold out of iPhones!!!

MARCH 26, 2008 9:34 P.M.

XamaX wrote:

It's the stars! I know I'll be ridiculed but just note that Apple is a April 1st born company and that the stock started its return as soon as Spring came up.
The company has an unbelievable line of products, an unbelievable line of prospective products, an amazing strategy that most people still haven't realised. Still, it can be the highest stock at $90 if there's a market crash.
And there has never been a time with as many chances of it to crash so deep that '29 depression will seem ridicule. Think about it: house credit shark scheme going belly up; US war on Iran; USD crashing due to OPEC changing to € and Iran opening oil bourse in € (true reason for US bombing them soon), consumer contraction and I'm sure there are others.
These are risky times, do not forget about it.
I'm an Apple/AAPL lover, been with it forever [but I'm a windows experienced user too], I'm long AAPL. And I'm loving what seems to be AAPL's recover. They say 148 is 1st resistance point...

MARCH 26, 2008 9:54 P.M.

XamaX wrote:

Apple's brilliant strategy - is it that brilliant? It seems brilliant compared to its retard competitors but it's really kind of 'duh' - is spelled in just a single word we all learned in biology class:

=======> ECOSSYSTEM!

Ok, there's also QUALITY and EXCELLENCE but they didn't seem to quite do it previously.

That one word - well, and the fact that they don't have a clue - is the reason why MSFT and SONY and etc is seriously in trouble - none of them has Sw+Hw, none of them has all the pieces together [and none of them has vision!]. Come on, HTC [which is making SONY's XPeria] even has to friggin' juggle up a better UI for WM?!!

And who buys a Sony Vaio out of being happy with a Sony cellphone? Why, it is the same Vista-XP crap full of holes every one else has!!

But ultimately - just think about this - it is about upper management. Look at them poor sods. I can only think of ASUS as the other only company that has some kind of good leadership and visionary strategy. But is it any threat to Apple?

My best friend and brother in law have been PC users for 20 years. Their next computer is a MacBook, no questions asked. Why buy Windows when you can have Windows & Leopard. Good product, Good CEO. Slam dunk.

MARCH 26, 2008 11:36 P.M.

What about HP wrote:

What could HP do to beat Apple?

MARCH 26, 2008 11:40 P.M.

Uh-huh wrote:

HP beating Apple? Get real...

MARCH 26, 2008 11:45 P.M.

What about HP wrote:

HP is a solid company with HW+SW, better cust support than Dell, and a determined CEO (Mark Hurd). OK. So, maybe HP can't beat Apple. But what could it do to compete effectively. I see a 2 player market with Apple and HP dividing most of the market. HP might even convince Apple to license OSX exclusively to HP. Thoughts?

MARCH 27, 2008 12:30 A.M.

Uh-huh wrote:

I think HP is a great company but out of its league when compared to the king.Apple is so much the future w/the most innovative CEO in technology.

MARCH 27, 2008 8:06 A.M.

College Campuses wrote:

Follow the kids if you want to see the future of tech... (Hint: Apple)

MARCH 27, 2008 9:18 A.M.

ohoh wrote:

Apple COO sells $40,000,000 of Apple stock.

MARCH 27, 2008 9:25 A.M.

Antie wrote:

What does apple COO know that we dont?? Bet he will be a buyer at 86 too.

MARCH 27, 2008 9:44 A.M.

antie wrote:

There goes RIMM longs and Apple longs follow. Look out below. Suspect Whatevers shrink will put him on suicide watch, as he lives and dies by his 1 stock portfolio.

MARCH 27, 2008 11:10 A.M.

Whatever wrote:

Wishful thinking,antie.I'm in Apple for the long haul unlike idiots like yourself.

MARCH 27, 2008 11:28 A.M.

ohoh wrote:

Morgan Stanley: 40% of college students plan to buy Macs

By AppleInsider Staff

Published: 03:00 PM EST

Apple's rapidly rising mindshare amongst current generation college students is setting the company up for an "aging phenomenon" that will spur further market share and revenue growth as those students enter the work force, investment bank Morgan Stanley said Wednesday.

A recent higher-education survey cited by analyst Katy Huberty reveals that roughly 40 percent of college students say their next computer purchase will be a Mac, well ahead of Apple's current 15 percent market share in the demographic.

In the near term, this sets the Cupertino-based Mac maker up for a strong September quarter -- a three-month period that embodies the heart of the back-to-school buying season, where incoming freshmen, existing undergraduates, and universities all plunk down considerable sums of cash in order to invest in computer hardware for the coming school year.

"Longer term," Huberty said, "we see an 'aging phenomenon' that will put Apple in a more mainstream market share position as students enter the work force, much like Linux adoption in the 1998-2003 time frame."

She noted that as the Linux platform matured and developers entered the workforce, enterprise-level Linux adoption accelerated eightfold, with 16 percent of servers shipped in 2003 running flavors of the linux operating systems compared to just 2 percent five years earlier.

For Apple, which holds just shy of 3 percent worldwide share of the personal computer market, each incremental percentage point of share gain means billions, Huberty said; approximately 6 billion in yearly revenues, and a full dollar in per share earnings for investors.

The analyst maintained her Overweight rating on shares of Apple, with a $185 per-share Base Case scenario that assumes Mac unit share rises to 3.5 percent from 2.9 percent in the next 12 months, and that consumers continue to buy up into the Mac product family, providing the company with some gross margin leverage.

Huberty also outline a $225 per-share Bull Case scenario which assumes twice the operating margin expansion of her Base Case scenario for the 2008 calendar year, driven by 40 percent revenue growth from broader demand for mobile products and greater success in the international and enterprise markets.

MARCH 27, 2008 11:30 A.M.

antie wrote:

Morgan Stanley: 40% of college students plan to buy Macs

By AppleInsider Staff

Published: 03:00 PM EST

Apple's rapidly rising mindshare amongst current generation college students is setting the company up for an "aging phenomenon" that will spur further market share and revenue growth as those students enter the work force, investment bank Morgan Stanley said Wednesday.

A recent higher-education survey cited by analyst Katy Huberty reveals that roughly 40 percent of college students say their next computer purchase will be a Mac, well ahead of Apple's current 15 percent market share in the demographic.

In the near term, this sets the Cupertino-based Mac maker up for a strong September quarter -- a three-month period that embodies the heart of the back-to-school buying season, where incoming freshmen, existing undergraduates, and universities all plunk down considerable sums of cash in order to invest in computer hardware for the coming school year.

"Longer term," Huberty said, "we see an 'aging phenomenon' that will put Apple in a more mainstream market share position as students enter the work force, much like Linux adoption in the 1998-2003 time frame."

She noted that as the Linux platform matured and developers entered the workforce, enterprise-level Linux adoption accelerated eightfold, with 16 percent of servers shipped in 2003 running flavors of the linux operating systems compared to just 2 percent five years earlier.

For Apple, which holds just shy of 3 percent worldwide share of the personal computer market, each incremental percentage point of share gain means billions, Huberty said; approximately 6 billion in yearly revenues, and a full dollar in per share earnings for investors.

The analyst maintained her Overweight rating on shares of Apple, with a $185 per-share Base Case scenario that assumes Mac unit share rises to 3.5 percent from 2.9 percent in the next 12 months, and that consumers continue to buy up into the Mac product family, providing the company with some gross margin leverage.

Huberty also outline a $225 per-share Bull Case scenario which assumes twice the operating margin expansion of her Base Case scenario for the 2008 calendar year, driven by 40 percent revenue growth from broader demand for mobile products and greater success in the international and enterprise markets.

MARCH 27, 2008 11:32 A.M.

antie wrote:

Zune and Vista Rock!

MARCH 27, 2008 1:40 P.M.

antie wrote:

Of course the above comments are not mine. Prob from that crack head Whatever. I like apple after the recession has played out and will invest again at 86 per share. I dont wish it to go down, its just the economy and the market stupid. As to todays comments, anyone who didnt know a pullback was due before RIMMs report should get out of here. Its a dangerous place.

MARCH 27, 2008 1:48 P.M.

Whatever wrote:

Sorry, antie,wasn't me.You have made enough enemies on this blog that it could be several people.You can invest again at "86" once the stock splits,moron.

MARCH 27, 2008 2:32 P.M.

antie wrote:

As long as my enemies are weak of mind like yourself, Im as pleased as punch.

MARCH 27, 2008 2:38 P.M.

Whatever wrote:

Please drink the punch,antie. Your feeble comebacks are as baseless as your stupid claims of "86".

MARCH 28, 2008 8:36 A.M.

Carlos From Brazil wrote:

No Iphone, to sell in all apple store in Orlando Florida (03/27/2008), lots of people asking when arrives...(sorry about my english)

About Tech Trader Daily

Tech Trader Daily is a blog on technology investing written by Barronâ€™s veteran Tiernan Ray. The blog provides news, analysis and original reporting on events important to investors in software, hardware, the Internet, telecommunications and related fields. Comments and tips can be sent to: techtraderdaily@barrons.com.